70's Fender Mustang
Kurt used this guitar on Nirvana's 1989 US tour. At some point in the northeast part of the tour Kurt had smashed the guitar to the point where it was rendered unplayable. He took it into Mouradian Guitar in MA to fix the broken neck but either did not have the time or the money to go through with the repair.
While in New Jersey Kurt traded his broken Mustang with Sluggo (of the band Grannies and Huballaloo) for a Gibson SG that Kurt ended up painting light blue.
At one point the guitar was on display at the Seattle EMP on loan from Sluggo himself. It was taken off display to be auctioned off. In December of 2008 the smashed guitar made news headlines when it sold for $100,000. It is rumored to be returning there on loan from it's current (private undisclosed) owner for the Nirvana 2010 exhibit at the EMP.
If anyone has more photos of this guitar please send!
Pictures of the trade @ Sluggo's house in NJ
Sources
Esteban B
The photograph above is from the last show that this guitar was used on (Wilkinsburg, PA 7/9/89). There are no videos of the show but it's assumed that's where the guitar was smashed last. The video below is from a performance on 7/12/89 in Philadelphia, PA. No Mustang, but still a neat insight on this era of the band.
And another great montage of photos from this era.